Iron Condor

You're in a loss position but not at maximum loss. One spread is fully losing (price is ITM on one side), but the long option provides some offset. Close or adjust rather than waiting - it's unlikely to improve without a reversal.

Yes. You can close either the put spread or call spread independently. This is useful when one side is profitable (close to lock in) or one side is tested (close to limit loss). The remaining spread is then a single vertical spread.

Risk/reward shifts against you as you approach max profit. The last 50% takes longer to capture, exposes you to gamma risk, and ties up capital. Closing at 50% has been shown to improve overall returns and reduce drawdowns in systematic testing.

Margin is typically the maximum of either spread width, not the sum. For example, if both spreads are 50 points (S$250 each), margin is S$250 minus credit, not S$500. Iron condors are margin-efficient because only one side can lose at any time.

In normal circumstances, no. Your long options cap your loss. However, pin risk at expiration (price exactly at short strike) can create assignment issues. Close before expiration to avoid this. Also, early assignment on equity options is possible but rare.

Roll if: You still believe in range-bound thesis and can roll for credit or minimal debit. Close if: Thesis is broken, you've reached stop loss, or rolling would cost too much. Ask: 'Would I enter this trade fresh?' If no, close.

Rolling out: Same strikes, later expiration. Buys time but doesn't give more room. Rolling down/up and out: Different strikes AND later expiration. Gives more room for price. Costs more but provides better protection. Choose based on how close price is to short strike.

Not necessarily. You might use different deltas based on directional bias (e.g., 0.20 delta puts, 0.15 delta calls if slightly bullish) or based on skew (puts often have higher IV, affecting equivalent probability). However, equal deltas is a good starting point.

During crashes, the put spread gets devastated while IV spikes (hurting negative vega). Options: 1) Have stop loss and honor it, 2) Close entire position quickly, 3) If held, the call spread will profit but unlikely to offset put losses. Prevention is better - size small, have stops.

Narrower wings: Lower max loss, lower margin, but lower credit too. Useful when: 1) Smaller account needs lower risk, 2) Very confident in range (don't need much protection), 3) Want to trade more contracts. Tradeoff is less premium per contract.

Analyze: 1) IV term structure - prefer flat or contango (not backwardation), 2) IV at different strikes - skew affects credit balance, 3) IV rank AND percentile - both should be elevated, 4) IV/HV relationship - large divergence may signal event. Enter when multiple volatility factors align favorably.

Use unbalanced when you have slight directional bias within neutral stance. Examples: 1) Put spread wider than call spread if slightly bearish (more protection on downside), 2) Asymmetric short strike distances based on support/resistance strength. Unbalanced condors allow nuanced positioning.

Strategies: 1) Limit positions in same sector (max 2), 2) Trade uncorrelated underlyings (stocks, indices, commodities), 3) Size based on portfolio-level correlation, not just individual max loss, 4) Consider VIX correlation - all equity iron condors get hurt by VIX spikes, 5) Hedge with small long vega position if over-exposed to short vega.

Depends on account size and risk tolerance. Guidelines: 1) Maximum 5 positions for active management, 2) No more than 30-40% of buying power utilized, 3) Diversified across sectors, 4) Staggered expirations (not all same month). Too few = concentration risk; too many = over-management and correlated losses.

Track: 1) Win rate (target 70-85%), 2) Average win (target 30-50% of max), 3) Average loss (target < 100% of max due to stops), 4) Expectancy = (Win% × Avg Win) - (Loss% × Avg Loss), 5) Return on capital utilized, 6) Sharpe ratio if possible. Compare to benchmarks and refine parameters based on data over 50+ trades.